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New CEO at SAA maps out a punishing austerity plan, with layoffs ‘unavoidable’

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Tuesday, 12 June 2018 09:17

BusinessLive reports that six months into the job of running loss-making SA Airways (SAA), CEO Vuyani Jarana has mapped out a punishing austerity plan to turn the national carrier around.

He indicated that layoffs and other cuts were unavoidable in the context of a draining cost-to-income ratio of 108%. "SAA cannot carry the same workforce, whether it is pilots, cabin crew or administration. We have to make some tough decisions to save the airline. There cannot be sacred cows when it comes to SAA," he said. Jarana declined to put a number to the job losses, but two knowledgeable sources said SAA was likely to cut between 1,000 and 1,500 people via a combination of layoffs and voluntary redundancies to bring its employee-per-aircraft ratio in line with regional competitors. The numbers apparently include about 300 flight attendants. Some of the carrier’s 700 pilots, encouraged to look for jobs elsewhere, have drafted their own severance pay offer to SAA, a source said. On Monday, SAA catering subsidiary Air Chefs announced it planned to retrench 118 workers in what could be the start of a more profound restructure of the airline’s entire workforce. The National Union of Metalworkers of SA said it would oppose the cuts.